Skift Take
Rotisserie hot dog and drippy cheese jokes aside, Amazon's Seattle store is a bigger competitor to fast casual businesses than convenience stores.
— Kristen Hawley
You won’t find a squeaking hot dog rotisserie in Amazon.com Inc.’s cashier-less convenience store. Instead, you’ll see Mediterranean lamb sandwiches, fresh salads and to-go containers of cubed pineapple and melon.
After more than a year of testing with an employee-only focus group, Amazon Go opens to the public Monday in downtown Seattle, putting to the test the online retailer’s technology that lets shoppers grab what they want and leave without paying a cashier. The inventory caters to health-conscious, affluent millennials rushing to their next meeting and could leave the stoner-slacker crowd searching aimlessly for the machine that barfs out chili and cheese with the push of a button.
“We got a lot of feedback on selection,” Amazon Go’s technology vice president Dilip Kumar said, adding that most changes over the past year involved the store’s inventory. Amazonians prefer their salad dressing on the side, for instance. And boxed meal kits to be cooked at home should be clearly labeled if they are vegan or gluten-free.
Amazon Go is the company’s most ambitious effort to change the way people shop in stores and a play for the struggling $550 billion U.S. convenience store industry. Amazon hopes the cashier-less technology will help it stand out from the nation’s 150,000 convenience stores where traffic jams can form at the checkout counter. It’s all part of the company’s larger brick-and-mortar ambitions, which include a stepped-up push into groceries with the Whole Foods Market acquisition as well as the opening of about a dozen book stores in such cities as Los Angeles, Chicago and New York.
To enter the Amazon Go store, customers download a smartphone app and scan a QR code to open a glass turnstile. Those shopping in a group scan the account holder’s phone once for each person entering and sensors will associate them with that account. From there, machines take over, watching the items plucked from shelves and adding them to a shopping cart. Shoppers are billed once they leave and if there are any mistakes or the customer isn’t happy with an item, you push a “refund” button to have that item removed from the bill. Shoppers don’t have to return an unwanted item to the store to get a refund.
The system is designed around the honor system with an understanding that those looking to trick the system and steal things are in the minority. “The system is very accurate,” Kumar said.
The 1,800-square-foot store is in the ground floor of Amazon’s new Seattle headquarters complex. On a recent lunchtime tour, about 10 chefs were in a kitchen making salads and sandwiches, and several other employees replenished the shelves. One employee monitored the small beer and wine section to manually check IDs.
There are typical convenience store staples like peanut butter, milk, eggs and bread. Freshly made items get prominent shelf space, as do veggie chips and other products from the Whole Foods “365 Everyday Value” brand. The experiment will only succeed if Amazon delivers quality food at good prices, said Jeff Lenard, spokesman for the National Association of Convenience Stores.
“The coolness of the technology will undoubtedly get people to check it out,” he said. “But the quality is what will get them to come back.”
©2018 Bloomberg L.P.
This article was written by Spencer Soper from Bloomberg and was legally licensed through the NewsCred publisher network. Please direct all licensing questions to [email protected].
